A comprehensive list of recently added postings on Dallasfed.org.
Product Turnover and the Cost of Living Index: Quality vs. Fashion Effects
This paper evaluates the effects of product turnover on a welfare-based cost-of-living index. We first present some facts about price and quantity changes over the product cycle employing scanner data for Japan for the years 1988-2013, which cover the deflationary period that started in the mid-1990s.
February 21, 2018
Optimal Monetary Policy Under Bounded Rationality
Optimal monetary policy under discretion, commitment, and optimal simple rules regimes is analyzed through a behavioral New Keynesian model. Flexible price level targeting dominates under discretion; flexible inflation targeting dominates under commitment; and strict price level targeting dominates when using optimal simple rules.
February 14, 2018
PCE Inflation Update, December 2017
The headline, or all-items, PCE price index rose at a 1.3 percent annualized rate in December, as a sharp decline in gasoline prices weighed on the headline index.
February 2, 2018
The Death of the Phillips Curve?
Are inflation dynamics well captured by Phillips Curve models, or has this framework become less relevant over time? The evidence for the U.S. suggests that the slopes of the price and wage Phillips Curves– the short-run inflation-unemployment trade-offs – are low and have got a little flatter.
February 2, 2018
Current Account Dynamics under Information Rigidity and Imperfect Capital Mobility
The current account in developed countries is highly persistent and volatile in comparison to output growth. The standard intertemporal current account model with rational expectations (RE) fails to account for the observed current account dynamics together with persistent changes in consumption.
February 2, 2018
Can Trend Inflation Solve the Delayed Overshooting Puzzle?
We develop an open economy New Keynesian model with heterogeneity in price stickiness and positive trend inflation. The main insight of our analysis is that, in the presence of heterogeneity in price stickiness, there is a strong link between trend inflation and the timing of the peak response of the real exchange rate to a monetary policy shock.
February 2, 2018
Austin Economic Indicators
Austin economic growth remained robust in December. The Austin Business-Cycle Index accelerated as job growth remained above trend and the unemployment rate held at a very low level.
February 1, 2018
Houston Economic Indicators
Economic data were mostly positive for Houston in December. Employment grew, and business-cycle and leading indexes were indicative of healthy economic output and future growth. Construction and real estate metrics were mixed but pointed to a tighter housing market and increased construction ahead. Overall, the outlook for Houston remains positive.
January 30, 2018
San Antonio Economic Indicators
The San Antonio economy expanded at a robust pace in December. The San Antonio Business-Cycle Index grew at its fastest pace since early 2015.
January 26, 2018
El Paso Economic Indicators
El Paso economic activity continues to climb. Maquiladoras in Ciudad Juárez are still adding jobs, and trade through the El Paso port of entry is steady. Home sales in El Paso remain robust, near all-time highs.
January 26, 2018